New State Laws Take Affect in NY

The beginning of a ban on electronic cigarettes and businesses tax breaks.

New state laws banning sales of electronic cigarettes to minors and giving businesses new tax exemptions for installing solar energy systems are set to take effect next week.

In 2013, New Yorkers will also calculate state income taxes owed based on the new rates that took effect in 2012 and which should have already been reflected in payroll deductions. Meanwhile, taxable income amounts could change based on a cost-of-living index adjustment in the law for the next two years.

The ban on sales to those under 18 of E-cigarettes, battery-powered devices used to inhale vaporized liquid nicotine instead of tobacco smoke, is effective Jan. 1. Though initially sold as an alternative to smoking harmful tobacco, critics say they come in candy flavors appealing to youths with addictive nicotine.

Sen. Owen Johnson, a Long Island Republican who sponsored the measure, said it was needed to protect children and young adults because E-cigarettes have been unregulated "and have not been proven to be safe for use at any age."

State law already prohibits selling cigarettes, cigars, chewing tobacco and herbal cigarettes to minors. Retailers can be fined from $300 to $1,000 for the first violation, according to the tax department.

At the same time, sales and installations of commercial solar units will become exempt from the 4 percent state sales and use tax starting next week. The law lets cities and counties do the same. It follows the 2005 tax exemption for residential systems.

The law defines commercial solar energy systems equipment as arrangements or combinations of installed components that use solar radiation to produce energy for heating, cooling, hot water or electricity.

The income tax law enacted in late 2011 lowered the rate in 2012 for a married couple filing jointly and earning $40,000 to $150,000 from 6.85 percent to 6.45 percent.

For those earning $150,000 to $300,000 it lowered the rate from 6.85 percent to 6.65 percent. At the same time, surcharges on higher tax brackets expired this year. Those earning $300,000 to $2 million, who had been paying surcharge rates from 7.85 to 8.97 percent, saw their rate drop back to the permanent rate of 6.85 percent.

Those making more than $2 million yearly, who had been paying 8.97 percent with the surcharge, had their rate changed to 8.82 percent. According to the Department of Taxation and Finance, for 2013 and 2014 the income tax rates will remain the same, though dollar amounts in the tax tables will be indexed by a cost-of-living percentage adjustment if it's applicable. Department spokesman Cary Ziter said those brackets are posted in mid-January.